Social media is the top online marketing channel for small businesses after company websites

According to the American Express OPEN and Search Engine Marketing Professional Organization (SEMPO) “Small Business Search Marketing Survey”, US small businesses recognize word-of-mouth as the top way their customers find them, followed by the internet and search engines.

The reliance on word-of-mouth—likely along with the low cost in dollars of participating—has led small businesses to make social media their No. 2 online marketing effort, after company websites.

As of March 2011, 44% of respondents to the survey used social media for marketing, vs. 28% who used SEO and 21% who used paid search. Looking ahead, more small businesses planned to add social media marketing this year than either search tactic.

Other research supports the finding that small businesses have made social a top priority. A February 2011 MerchantCircle survey found over 70% of US local small businesses used Facebook for marketing, while only about two-thirds used Google and one-third used Bing.

While 57.2% of small business respondents told Ad-ology that social media was at least somewhat useful at generating leads, the MerchantCircle survey found local small businesses were more likely to say search engine marketing was an effective channel than social networks, at 40.2% vs. 36.7%.

Social may have an easier learning curve and require less direct spending by small businesses that are less experienced with online marketing—and the “must-do” factor helps as well—but time-tested online marketing methods like search should not be ignored. Search, in particular, unquestionably helps businesses get found by consumers right when they’re looking to buy.